News Content
Verified Gross Mass rule to increase costs of LA-Shanghai box 14pc
A NEW report says the time and money needed verify the weight of all containers stands to increase costs for shipping a container from Los Angeles to Shanghai by 14pc, reports the Wall Street Journal.
New York research consultancy Cowen and Co said costs would increase because of the extra time and expense that shipping lines and their customers face.
Those costs may include fees for weighing shipping containers and charges for holding goods while information on the goods is collected and verified.
The report said apparel importers face the biggest impact when the rule takes effect July 1 since they will be moving new clothing lines to stores for the fall.
Many of those importers may start shipping clothing by air freight, which is far more expensive than ocean freight to get around potential bottlenecks, the Cowen report said.
"Extended shipping times could result in greater air freight usage for key back-to-school deliveries," the report said. "And potential inventory markdown or cancelled orders will come from delaying shipments."
The requirement come from the UN's International Maritime Organisation (IMO). It requires shippers to provide "verified gross mass," or weight of all containers and any filler material before they are loaded on to ships.
Today, only an estimate is required for loading. That has led to improperly loaded containers, regulators say, including collapsing container stacks.
Although the weighing is seemingly simple for any one container, the requirement adds a new wrinkle to logistics operation, adding daunting and expensive complications across shipping networks.
The Ocean Carrier Equipment Management Association, which represent carriers, released its own analysis and said container should not be loaded if shippers haven't submitted the verified weight information to carriers.
Shipping intermediaries such a freight forwarders stand to benefit from the new rule, the Cowen report said, as shippers will likely call on them to help manage the changes. But none of the solutions have addressed shippers' concern about costs.
New York research consultancy Cowen and Co said costs would increase because of the extra time and expense that shipping lines and their customers face.
Those costs may include fees for weighing shipping containers and charges for holding goods while information on the goods is collected and verified.
The report said apparel importers face the biggest impact when the rule takes effect July 1 since they will be moving new clothing lines to stores for the fall.
Many of those importers may start shipping clothing by air freight, which is far more expensive than ocean freight to get around potential bottlenecks, the Cowen report said.
"Extended shipping times could result in greater air freight usage for key back-to-school deliveries," the report said. "And potential inventory markdown or cancelled orders will come from delaying shipments."
The requirement come from the UN's International Maritime Organisation (IMO). It requires shippers to provide "verified gross mass," or weight of all containers and any filler material before they are loaded on to ships.
Today, only an estimate is required for loading. That has led to improperly loaded containers, regulators say, including collapsing container stacks.
Although the weighing is seemingly simple for any one container, the requirement adds a new wrinkle to logistics operation, adding daunting and expensive complications across shipping networks.
The Ocean Carrier Equipment Management Association, which represent carriers, released its own analysis and said container should not be loaded if shippers haven't submitted the verified weight information to carriers.
Shipping intermediaries such a freight forwarders stand to benefit from the new rule, the Cowen report said, as shippers will likely call on them to help manage the changes. But none of the solutions have addressed shippers' concern about costs.
Latest News
- For the first time, tianjin Port realized the whole process of dock operati...
- From January to August, piracy incidents in Asia increased by 38%!The situa...
- Quasi-conference TSA closes as role redundant in mega merger world
- Singapore says TPP, born again as CPTPP, is now headed for adoption
- Antwerp posts 5th record year with boxes up 4.3pc to 10 million TEU
- Savannah lifts record 4 million TEU in '17 as it deepens port
